Leadership and Management in Operations: An IKEA Case Study

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Management and Operations
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Contents
Introduction:..............................................................................................................................................3
LO1: Difference between leader’s roles and managerial functions:......................................................3
LO2: Apply the role of a leader and the function of a manager in given contexts...............................6
LO3: Demonstrate an appreciation of the role leaders and mangers play in the operations function
of an organization......................................................................................................................................9
LO4: Demonstrate an understanding of the relationship between leadership and management in a
contemporary business environment.....................................................................................................11
Conclusion:..............................................................................................................................................12
References................................................................................................................................................13

Introduction:
An organization survives due to the management and, operations management is one of the
important areas of management which deals with designing and implementing the production
process or business process reengineering which deals with the redesigning of process of
production. Operations management aims at creating and maintain the efficiency at high levels at
all times in an organization by utilizing all the available resources at best possible manner in
order to maximize the profits of the organization. In this particular report, as a part of the IKEA
organization we would be having an insight into its organization management within the
company and discuss about it. The report further gives insights on how roles of leader differs
from that of a manager in different contexts by assessing the strengths and weakness of both of
them.
LO1: Difference between leader’s roles and managerial functions:
Discuss the role of leader and manager and compare their characteristics
Who is a Manager? In simple terms any person in an organization who is responsible to control
a group of employees or administer an organization and whose expert in managing resources is
known as a manager (Murphy, 2017). As told by a French management theorist Henri Fayol a
manager is the one who can plan, lead, control, organize and co-ordinate things in an
organization.
Role of a manager: A manager performs such roles in an organization which are essential for
smooth running of the business and also to achieve the objectives and goals on the other hand.
These roles can be broadly classified into organizing, planning, controlling, directing and
staffing of the employees in any organization (Ogbolu, 2018). Managers at IKEA systematically
and carefully process the information way before taking any decisions in an organization, hence
making them reflective thinkers. Apart from these, managers at IKEA also perform roles such as
interpersonal, informational and decisional roles. Figurehead roles of IKEA managers are not
that serious but important for smooth running of the business like signing of documents,
welcoming delegates, ceremonial roles etc. Leadership role of IKEA managers takes into account
the coordination of others works, delegating work to subordinates and hiring etc. Liaison role of

IKEA managers includes motivating, encouraging and building up the team spirit of the
members of the organization (Bosworth, 2016). Monitor role of IKEA manager deals with
getting information about the internal as well as external environment thus monitoring the
environment. Disseminator and spokesman role of IKEA managers looks after disseminating the
collected information and representing IKEA to the outsiders of the organization. Decision roles
of IKEA managers include entrepreneur role which deals with overseeing the organizations
performance, disturbance handler role which deals with handling disturbances such as strikes,
sales declining and bankruptcy of customers, and resource allocator role which looks over
allocation of resources to different parts of the organization.
Leader: A leader is a person who has his influence on a group of people in an organization by
driving them to achieve the goal or objective of the organization. Leader is a person who also has
a vision, motivation, empathy, creativity, managing, teambuilding and risk taking (Goleman,
2018).
Roles of a leader: The act of leading is known as leadership and this is required at all levels of
management in an organization. At IKEA the leaders at top-level management generally looks
after planning and policy formulation, middle and lower management deals with execution of the
plans formulated by the top management. Another role of the leader is to represent the
organization that they work for at general meetings, conferences, seminars etc. and communicate
to the public on behalf of the organization (Hudson, 2017). Leaders also indulges in reconciling
the personal goals with that of the organization through leadership traits. Leaders at IKEA lend
their support to their peers and subordinates by inspiring and motivating them continuously.
Leaders also delegate and empower the works in the organization.
Comparison of the roles of a leader to that of a manager (Sheng, 2017):
 A leader creates a vision of the organization whereas the managers create the goals of the
organization.
 Leaders are the agents of change in any organization, on the other hand managers are the
ones that maintain the status quo in an organization.
 Leaders are more of risk takers but mangers are the one who control the risk in an
organization.

 Leaders have a long sight and work for distant goals whereas managers have short term
goals and objectives.
 Leaders are the person who build relationships and on the other hand managers are the
ones who build systems and processes.
Analyze and differentiate between the role of a leader and function of a manager by
effectively applying a range of theories and concepts.
The difference between a leader and a manager can be further better understood through various
theories and concepts.
Mintzberg Managerial Theory: This particular theory has been given by a management expert
called Henry Mintzberg, who has written various management books and Cleghorn Professorship
of Management Studies. According to him, although every manager is different yet they should
master and practice interpersonal, informational and decisional roles (Chun, 2018).
 Interpersonal roles of the manager include a manager to be a figurehead, leader and
liaison.
 Informational role of the manager breaks down into monitoring roles, dissemination roles
and spokesperson roles.
 A leader’s decision roles include entrepreneurial, negotiating roles, resource allocator
roles, disturbance handler roles etc.
Transformational Leadership Theory:
This theory is about introducing new approaches to leadership, which is given and first
introduced by James MacGregor Burns. Burns basically divided leadership styles into two broad
categories namely transactional and transformational (Turner, 2017). To explain this better
transactional leader concentrates on increasing the compliance by withholding the rewards
whereas transformational leaders supports each other and organization as a whole by focusing on
transforming. At IKEA leaders follow transformational leadership rather than transactional
leadership as people tend to work hard, trust, respect and admire a transformational leader rather

than a transactional leader. The leader as IKEA exhibit factors such as motivation, consistent
vision, intellectual simulation, influence, individualized consideration (Dumitru, 2015).
LO2: Apply the role of a leader and the function of a manager in given contexts
Examine examples of how the role of a leader and the function of a manager apply in
different situational contexts
The various roles of a leader as well as of a manager can be better explained with the help of
Henri Fayol’s model that has five stages which are discussed as follows:
Planning: This is the first and foremost step taken up by the managers or leaders which involves
them planning and getting ready for the future conditions, plan and implement strategies in order
to achieve the desired goals and objectives of the organization (Anand, 2018). This is the hardest
function as it involves predicting the future and developing strategies accordingly.
Organizing: The managers or leaders must organize resources in an organization in such a way
that there is sufficient workforce, capital, raw material in order to have a smooth functioning of
business. This is the second most important function.
Commanding: Managers or leaders must have a commanding nature on their subordinates in
their every work and should motivate and inspire them to achieve the personal as well as
professional objectives set by them (Engelbrecht, 2015).
Coordinating: Managers or leaders have to coordinate the procedures and activities that are
carried out in the organization. In other words, every work should complement the work of other.
Controlling: Managers or leaders’ control by checking constantly if everything is going
according to plan or not. This particular step involves establishing performance standards,
measuring and reporting performance on actual basis, comparing results, and taking predictive
and corrective measures as and when required.
These roles of manager and leader shall be applied in various contexts or situations in an
organization. In case of IKEA as the raw material costs were on the verge of an increase, the
leaders have adopted contemporary theory of leadership to handle the increased cost of

production and increasing raw material cost. The strategies included reaching out to suppliers to
negotiate about the price or looking for alternative suppliers offering best prices and adopting
new technologies that cuts down the cost of production at certain aspects (Covey, 2017). In
situations like these leaders can motivate and inspire the employees to perform better and reduce
the cost of production.
Situational Leadership
This particular leadership style says that no single leadership style is best suited, rather it
depends on the situation on which type of leadership style are best suited to the situation. This
leadership style uses four core properties to deal with the situations in an organization as follows:
Diagnose: This is the first stage where the leader or manger tries to diagnose the situation and
understand it and develop strategies accordingly. In the given context as the raw material costs
are increasing the leaders must adopt to strategies that will reduce the cost of production.
Adapt: In the particular stage the leader or manager should develop strategies that will help them
in adapting to the changing environment in and around the organization. Strategies must be
developed to enhance the efficiency by adapting to the environment.
Communicate: The managers or leaders have the responsibility to communicate the changing
environment that affect the business to the employees and stakeholders of the organization so
that they can collectively design strategies to adapt to it (Glinkowska, 2017).
Advance: The managers or leaders must advance in adopting to new ways and technologies in
order to get accustomed to the changing environment. This can be done through incorporating
new technologies and ideas in the business to reduce the cost of production.
Systems Leadership: This particular style of leadership enables the leaders of IKEA to create a
business environment that enhances the productivity by utilizing the maximum potential of the
organization’s workforce (Quinn, 2015). In this leadership the leaders have control over the
workforce and communicate about the changing environment to the employees so that they can
work accordingly. This kind of leadership also helps the company to bring down the cost of
production and information is shared by the operational management team so that employees
work towards the objectives.

Contingency Leadership: This model states that a single leadership model is not efficient in
every situation of the organization IKEA is facing. IKEA managers should adopt a participative
style of leadership as they are facing with the challenge of increase in material costs. By
following this style, the employees and other workforce will come up with strategies to cut down
the costs of manufacturing which will help the organization.
All the leaders and managers have their own strengths and suffer from weaknesses as well which
is discussed as follows:
Strengths of a leader (Owen, 2017)
 Coordinate Team Members- a leader always motivates and encourage the team so that
targets can be achieved.
 Setting plans- always set suitable plans, responsibilities, clarify roles to the group
members, assigns tasks and setting the ultimate objectives to be achieved.
 Leader always makes plans and strategies way ahead of situations as he’s curious and
proactive.
 Leader has excellent communication skills to lead a team.
 Leaders are confident enough for setting the plans, executing them, thus achieving the
goals.
Weaknesses of a leader (Erdogan, 2015).
 A leader can’t trust his employees for the work completion.
 Leader is usually self-centered to his tasks and goals.
 Leader generally don’t define the goals properly.
 Employees sometimes are not cleared about the targets to be achieved
 Most of the leaders are not broad minded rather narrow minded.
Analysis of various leadership styles:
Situational leadership model strengths include providing a clear view of the organizational
situation, helping employees to perform accordingly, flexible and approachable model and
creating a more productive environment. The short comes or weakness of this model are that it
tends to focus more on short term plans, lack of understanding due to less experience.

Leadership model strengths includes providing efficient plans and ideas to overcome the worst
situations and provides a clarified scenario of business environment. On the other hand,
weakness includes risks associated to the model is really high and gets complicated to execute
the plans.
The strengths of Contingency leadership model is that it focuses more on the future aspects,
creates leadership profiles, proactive and predictive in nature. Whereas the weakness of this
model is that it gets difficult to deal with situations, which restricts managers to work properly in
an organization.
LO3: Demonstrate an appreciation of the role leaders and mangers play in the operations
function of an organization.
Operations management can be defined as a process of achieving high efficiency levels in an
organization through managing its operations. By doing so one can maximize the revenue and in
turn increase profits by converting the goods and resources of the organization into labor.
There are various models and theories such as Kaizan model, just-in-time inventory model and
total quality management model etc. which explains the key aspects of the roles of the leader and
manager (Huber, 2018)
.
Total Quality Management Model:
This particular model aims at delivering high quality products and services to the customer to
improve their satisfaction by combining both the management and employees of the IKEA. Thee
principles followed in this model are as follows (Dukakis, 2015):
 Customer focus: Any organization focuses on customer satisfaction by delivering best
quality products at best prices by catering to the customer needs.
 Strong leadership: Leaders of the organization should have strong leadership skills in
order to achieve the desired goals and objectives.
 Involvement of people: In order to achieve the desired goals, there must be teamwork
which helps in faster accomplishment of tasks and work.

 Good approach to management: In order to improve the quality of the products a
systematic approach to management must be followed.
 Constant improvement: There must be constant improvement in the organization as and
when tasks are achieved within the organization.
 Decision making: Every decision should be analyzed and measured so as to see its effects
on the organization.
 Relationship with suppliers: Any organization should have good relationship with the
suppliers to benefit the organization which will help in timely supply of materials.
The role of leader in this particular model is to ensure effective utilization of resources, efficient
measurement of employee processes, provision of support by management team to achieve the
objectives of the organization.
On the other hand, the role of a manger in this model is to connect and focus on customers both
internal and external, maintain relationship with suppliers, ensuring constant and continuous
improvement in the organization.
Operations management functions can be listed as follows:
Control and distribution systems: This particular function of the organization enables control
over the production process by managing the distribution process of the organization. These
processes will not be executed as planned if they are not looked over by the managers.
Converting raw materials into finished goods: This particular process is very important and
should be looked over by the manager as the production should be in accordance to the demand
of the product otherwise there will be over or under production which will result in losses.
Product Design: This is most crucial part as this deal with producing and designing the products
according to the customer needs. As IKEA is into home furnishing, they have to give keen
importance to customer’s preference so as to make goods accordingly (Gilley, 2015).
There are various ways in which IKEA can motivate and inspire their workforce to meet the
objectives and goals of the organization. IKEA should create a virtual private network and give
access to its employees so that they can connect to the servers and perform their respective works
in a smooth way, which will enhance the productivity of the organization. The leaders must

inspire and empower the workforce of the organization to achieve the objectives and goals.
Managers should work towards improving the collaboration between the management and
employees so that there is a smooth flow of operations which will in turn help to faster
achievement of goals of the organization. The leaders should create a proactive and positive
environment in the organization.
LO4: Demonstrate an understanding of the relationship between leadership and
management in a contemporary business environment.
There are a variety of factors that affect the operations management in an organization such as
culture, values, ethics, Corporate Social Responsibility (CSR) and sustainability which effects
the decision making of the organization.
Culture and values: These are the beliefs that are defined and followed throughout the
organization. These both aspects play a very crucial role in decision making in any organization
and IKEA isn’t an exception to this. Every organization keeps culture and values in mind while
designing and producing the required goods and services.
Ethics: Ethics are an integrated part of any organization. At IKEA all the processes are carried
out keeping ethical values in mind and decisions are taken accordingly. Unethical behavior or
processes are not tolerated at especially IKEA.
Corporate Social Responsibility (CSR): This principle helps the organization to be socially
accountable to self, public and stakeholders. The companies should take up corporate social
responsibility activities that helps in sustainable development in the society. The operations
management of the organization should ensure production by having a check on sustainable
development of resources in the economy. At IKEA these CSR activities include producing
goods with recycled materials, use of sustainable resources, use of environmentally friendly
materials, renewable energy in production etc (Simons, 2015).
Sustainability: This principle focusses on fulfilling the needs of the present generation without
compromising the demands of the future generations. This has a profound impact on the decision
making of the organization as they have to make use of the available resources more efficiently
and save the resources that can be saved for the future.

All these factors and principles discussed above will improve the goodwill and brand image of
the organization which will in turn increase the customer base of the organization. CSR activities
of the organization shows that they are socially accountable to the society and stake holders of
the organization (Navarro, 2016). This will also improve the relationships with the suppliers,
customers and other stakeholders which will help them to increase and enhance the productivity.
Conclusion:
Operations management is a defined process to achieve a high level of efficiency through the
process of operations within an organization. By doing so the organization can maximize its
profits by converting the goods and services into labor. We have taken IKEA in this report to
analyses the operations management of the organization. The above report discusses the
definition and various roles of a leader and a manager, and the differences between the roles
undertaken by them. The report further talks about various contexts where the roles of leader and
manager can be applied and different theories defining the managerial and leadership roles. We
have used various leadership styles to better understand the contextual leadership supplication
process. Using all these theories and models we have analyzed the strengths and weakness of the
leaders as well as of the theories. This report discusses the significance of the operations
management to achieve the overall objectives and goals of the organization. The report is
concluded by stating various factors that affect the operations management of IKEA.